Cost-cutting Entails Shared Incentive, Says KPMG

Most capital investment programmes in the UK claim cost savings in the planning stage but turn into cost overruns during construction, creating the risk of under-delivery.

This was the statement of Stuart Westgate, risk consulting director at KPMG, in his comments on the government’s announcement to reduce cost in UK infrastructure projects by 2015.

Westgate said: “KPMG welcomes the government’s announced progress in achieving reductions in the cost of delivering the UK’s infrastructure.

UK is currently facing a significant infrastructure deficit and the £200bn to be invested in the next 5 years needs to go further if the UK is to retain its international competitiveness, he added.

“Therefore, the government needs to ensure that cost planning and estimation is robust, and encourage long term reform in the UK’s construction supply chain so there is a shared incentive to reduce cost,” Westgate said.